The Indiana Court of Appeals issued the opinion of Jackson v. Trancik on July 20, 2011, involving proper methods of proof for the amount due to a medical provider for medical services. The background was a doctor who provided medical services, billed the patient’s insurer, got partial payment from the insurer, got a $20 co-pay from the patient, and sued for the balance. The patient apparently did not dispute the balance due until after the lawsuit was filed. The doctor filed for summary judgment, relying on certain presumptions created under Indiana rules of evidence for medical bills (Ind. R. Evid 413) and for bills sent out that are not disputed within a “reasonable time” (the “account stated” doctrine).
The patient attempted to resist the judgment by submitting the affidavit of a person holding herself out as a medical billing expert. Her qualifications were that she makes a living evaluating medical bills (kind of a bootstrap “I’m an expert because I make my living being an expert” rationale) and she ran the bill through a coding system apparently used by insurers and found that the doctor’s bill did not comport with that billing system. The trial court struck the affidavit and, having nothing else to rebut the presumptions, summary judgment was entered in favor of the doctor.
The court of appeals took a look and concluded that the expert affidavit should have been regarded as creating a material question of fact, meaning that summary judgment was not appropriate, but the value of the services should be given to the trier of fact as a question.
If I’m reading the language of the Court of Appeals correctly, I think they’re trying to allow use of such experts when a doctor is trying to collect on a contract but not where a tortfeasor is trying to rebut a personal injury plaintiff’s prima facie case based on medical bills. I’m not sure they succeeded. In both the contract case (where the doctor is trying to collect) and the personal injury claim (where the injured party is trying to recoup the medical costs they’ve incurred because of the other party’s negligence), the standard is the reasonable value of the services. The Court of Appeals tries to thread a needle between “the amounts usually, customarily, and reasonably billed for such services” in the contract case on the one hand and “the reasonable value of the services” on the other.
The use of slightly different language does not, I don’t think, reflect an intent that the plaintiff recover anything other than the reasonable value of the services in either case. So, if the Court of Appeals is trying to create a system where doctors can be expected to wrangle with the potentially sketchy testimony of “medical billing experts” but injured plaintiffs can not; I’m not sure it succeeded, nor do I think such a double standard should stand. The underlying problem is that the lack of transparency in medical pricing is astounding. However the Courts choose to address that problem should apply equally to medical providers and personal injury plaintiffs.
Another issue I would have liked to have seen addressed in the opinion is that the expert apparently based her opinion on common insurance billing practices. She opined that doctors were supposed to bill for successive services during the same visit in a certain way and that, if they didn’t, the insurance company would adjust the bill downward. But there is no indication as to whether this doctor was part of the insurance company’s network; e.g. whether it was reasonable to treat this doctor the same as doctors who had signed on to the insurance company billing practices. From the facts I read, my suspicion is that the doctor wasn’t part of the network. And, it makes a difference, the doctor is presumably signing on to a network – and subjecting himself to the requirements that entails – in exchange for some benefit (e.g. getting more patients because he or she is in the network). Sure, the insurance company paid some money — but for all we know from the opinion, that could have been solely a function of the insurer’s contract with the patient; there may not have been any kind of agreement between the doctor and the insurer. And, if that was the case, I think the trial judge would have been correct to strike an expert’s affidavit if it was based on evaluating the interaction between insurers and doctors who did have a contract with one another.